Interview with Jean-Claude Biver, CEO of Swiss watch brand TAG Heuer
Few can claim to have Jean-Claude Biver’s eye for brands that are diamonds in the rough. Fewer still can claim to have had his level of success
Love him or hate him, there’s no denying Jean-Claude Biver’s Midas touch. Blancpain. Omega. Hublot. The man made an unqualified success of each, and is now working on taking TAG Heuer back to its glory days and probably beyond. To that end, he has initiated several projects in the two years or so since taking over as the brand’s CEO, the most controversial being the Carrera Heuer-02T, a COSC-certified tourbillon chronograph that retails for a bargain price of just around US$15,000.
Biver is no stranger to bold moves like this and there is a method to his madness – he sees TAG Heuer’s price positioning in the past as one of its greatest assets, and such cutthroat prices are a way to reestablish it. It has always been his modus operandi, after all, to exploit a brand’s uniqueness. In a market that often blurs the line between price and prestige, Biver is taking a contrarian stance by working towards a lower, more accessible price segment for the brand instead. Judging by TAG Heuer’s performance in the LVMH group’s reports, this is going to be another notch on his belt in no time.
It has been almost two years since you took over at TAG Heuer. Do you consider the majority of your work done?
I consider 85 per cent of the work done, but the market has only seen 35 per cent. We have movements and cases that haven’t been revealed, technical advancements that haven’t reached the market, and patents that are still pending. There are marketing projects that will only be seen in 2018, and movies tie-ins that haven’t been released. These make up the 50 per cent that is done, but still invisible. Again, only 35 per cent of everything has been seen – what’s coming out in time will be double of what’s already been shown.
What of the remaining 15 per cent that still needs to be done?
That is what we have yet to accomplish. I think we are too weak in motor racing now. Whether for the right or wrong reasons — it is not my place to criticise — we have allowed the sport to fall by the wayside, and stopped being the official timekeeper of Formula 1, the 24 Hours of Le Mans, and so on. We’ve lost our presence in this field, and we need to re-conquer it. I think we also need more female ambassadors, and greater emphasis on ladies’ watches. These are some of the things that make up the final 15 per cent.
Is this drive to retake TAG Heuer’s spot in motor racing driven by nostalgia, or something else?
We will never go back to motor racing if it had no potential, even if it is a part of TAG Heuer’s DNA. Just having a heritage somewhere, or a historical connection to something, is not enough. As it stands, it’s in our DNA and there is potential here so we have to go back.
And you’ve made progress here, with the TAG Heuer branding on Red Bull Racing’s engine, for example.
Yes, that was a good comeback for us, at least. We need to be very careful with deals like this nowadays, because our competitors now perceive us as a serious threat, and have become very reactive to what we do — they observe and adapt very quickly. It’s a good sign, but there’s a price to pay because they may undermine us by, for example, offering a higher price for a deal.
Another big change that you’ve introduced is TAG Heuer’s repositioning as a brand for affordable luxury. Why?
Oh yes, this is very important. TAG Heuer had incredible success in the 1980s and 1990s, and it was the affordable luxury brand at that time. This was, of course, backed by strong products, good ambassadors, and so on, but a large part of its success was due to its identity of being affordable luxury. I decided that we had to reclaim this reason for the brand’s success. Mind you, I didn’t invent any of this – it was just my analysis of TAG Heuer’s history that made me return the brand to sports, sports timing, and affordable luxury. It’s nothing new. In the 1980s, for example, TAG Heuer sponsored a cycling team called 7-Eleven. When I wanted to work with BMC Racing, whose manager was the founder of 7-Eleven, there were people who questioned this decision. “Why cycling, Mr Biver?” Well, they asked only because they didn’t know that we were already involved in the 1980s!
The 1980s and 1990s were a long time ago though.
Yes, but affordable luxury is not in the past. It has grown, because the middle class is much larger, so we have an even bigger market than before. And we actually face less competition now, because the Swiss brands have mostly priced themselves out of this segment.
Yes, many Swiss brands are pricing themselves upwards, and justifying this by offering more value through in-house movements and the like. You, on the other hand, want to move TAG Heuer’s prices downwards.
Yes, but there is no danger. TAG Heuer can produce and sell thousands of tourbillons. We currently certify 44 Heuer-02T movements with COSC every week, and plan to produce 2,000 of them next year. It is significant, but if you think about it, 2,000 watches at US$15,000 each does not make us a mass-market brand. In fact, for most people, that is a hell lot of money for a watch! Affordable luxury is a position that must be considered in relation to the competition — our tourbillon is accessible because the next closest costs over twice that — and there’s a position to take at every price. A watch can be accessible, but that doesn’t mean that it is cheap.
Is this also why the Monaco V4 Phantom was released at a lower price than the original?
Yes, we priced it to sell, and did that by optimising production. You can reduce prices by narrowing margins or, if you produce your own watches, by cutting costs. Before I took over, TAG Heuer often worked on special pieces but never considered their prices. Instead, the focus was on the product itself, and the PR value it would create. But these efforts must be followed through with sales! If the price is not competitive, the development becomes something that goes into the brand’s history, but not something that is sustainable, because it will not sell. This is not what I want. I am not here to create a show, but to do business. After I took over, I ordered a review, because I was ready to do another version of the Monaco V4. But the team had to study the price first.
You released the Monza this year, and are following up with the Autavia next year. Why this sudden interest in reissues?
The Monza and Monaco are reissues, yes, but not the Autavia. When it comes to reissues, we must be careful not to overdo things because we cannot live by repeating yesterday — we need to create a tomorrow. The Monza was already in the pipeline when I took over, so I gave the go ahead with just a little modification to have it in black. When I took over, I laid down the rule that if we bring an old model back, it must have its own personality and be different from the original. What did this mean for the Autavia? It looks like the original from a distance, but its size, materials, and movement are not the same. These changes make it sufficiently different from the original, so it doesn’t dilute collectors’ interest.
Are you referring to the vintage market for Heuer timepieces?
Yes, we are very keen to protect it. We have created a restoration department with 18 people for this. Part of the team is managing the data needed to trace the provenance of each vintage watch. We want to eventually be able to issue a certificate to each collector, to tell him the date that his watch was produced, how many pieces of that model were made, the details of its movement, where and how much it sold for, and even when production stopped and the reference that replaced it.
How does this benefit the brand?
It supports the vintage market and protects the history and legacy of the brand. It’s essential that we keep proper records because the more our collectors are interested in our history, the more the next generation will be interested in our future.
Frankly, TAG Heuer has a bewildering number of brand ambassadors and partnerships. Aren’t you worried that this perceived lack of exclusivity might dilute the brand?
We have to speak to every group of our customers differently. There are ambassadors and partnerships that are targeted at just one narrow category of our customers, but thanks to the Internet now, whatever we do somewhere will appear everywhere else. This gives people the illusion that we have too many partners. Someone in Switzerland may question why TAG Heuer partnered with a lady from Colombia — so what if she was an Olympic medallist? For Colombians, however, she’s a hero! Of course, we want to work with her, but this is for Colombia, not Switzerland. So what seems like a huge number is actually very limited if we consider it country by country.
Some of these partnerships appear excessively risky though. Géraldine Fasnacht, for instance, does wingsuit BASE jumping, with estimated fatality rates that are worse than one in every 60 participants. What are your thoughts?
We know her sufficiently well to be assured that she isn’t any more likely to die than a speed skier, because she is a master in this field. Of course, we recognise that she takes more risks than [model and actress] Cara Delevinge. But our motto is “Don’t Crack Under Pressure”, and we want to work with people who can live this.
This article was originally published in WOW.